Property firm’s profit soars 700%

GREEN PROPERTY, taken private by management two years ago, saw its profits rise by nearly 700% last year.

Recently filed accounts show profits before tax came it at €79.98 million for the year to end December 2003, well ahead of the €10m it made in 2002 its last year as a listed Irish company.

Despite rental property income falling heavily over the year, an upwards revaluation of its assets and the sale of some property were behind the profits surge.

Green Property's main asset is the massive Blanchardstown shopping centre in West Dublin, which is Ireland's largest retail complex. It has already embarked on a major expansion of the site and has lined up Spanish fashion retailer Zara as a tenant.

"The results for the year were much stronger than expected and were significantly ahead of the business plan. The group completed a restructuring of the business, which involved the disposal of the UK and Jersey portfolio," the directors noted in the accounts.

The British properties were sold to investment company Burford, which is partly-owned by US bank Lehman Brothers, for around €950m.

The property sale included the 50% stake in the London headquarters of investment bank Goldman Sachs on Fleet Street, a 115,000 sq ft office development at Brentford, an 80,000 sq ft office block in Slough and the Trafford industrial estate near Manchester.

The restructuring cost Green more than €2m and saw 18 employees leave the company.

This reduced its wages and salary bill from €10.7m to €5.8m.

The average salary at the company was €170,000. The pay figures include €2.99m which went to the executive directors.

Turnover for the year was down some 25% at 83m, reflecting a number of disposals since the MBO went through.

Around €35m of the group's rental incomes came from its retail properties, mainly the Blanchardstown Centre, with the remainder coming from office and industrial properties.

Green Property is not involved in residential developments.

Earlier this year, the company also completed a refinancing of its debt, led by Bank of Ireland, Barclay's Bank and the Bank of Scotland.

It was the largest ever property financing deal done in Ireland, the company said.

The accounts show that at the end of last December, Green had accumulated profits of €458m, while shareholders' funds were €1.35 billion.

Green Property was taken private by managing director Stephen Vernon last year in a €1.05bn deal backed by Merrill Lynch and ICC Bank.

Mr Vernon said at the time that the market value of the company's shares did not reflect the value of its assets.

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